Event: the company released its 2019 semi-annual report, with revenue of 208 million yuan, up 15.30% over the same period last year; net profit of 24.917 million yuan, up 5.92% over the same period last year; and net profit of 24.427 million yuan, up 9.52% over the same period last year.
Q2 revenue has obviously picked up, and the gross profit margin of the main business has improved. The company's Q2 revenue was 127 million yuan, an increase of 32.65% over the same period last year and 56.39% month-on-month, with revenue reaching an all-time high in a single quarter. The company is the leading company of RF coaxial cable in China, and its main products are widely used in mobile phone / computer / TV / wireless communications and other terminal electronic products. In terms of customers, the company focuses on developing large and medium-sized electronic equipment manufacturers, including Qiji Technology, Lianzhan Technology, PUL Technology and so on. The final service terminal electronic products include Apple Inc, Samsung, Hewlett-Packard, Lenovo, TP-LINK and many other world-famous brands. Highlight the company's position in the industry. With the acceleration of the national 5G strategy and the rapid improvement of the permeability of the Internet of things, the demand for RF coaxial cable is strong, and the company's upgraded new products for 5G demand have gradually begun to supply. At the same time, the company increases the intensity of product adjustment, increases the sales proportion of fine and ultra-fine RF coaxial cable, attacks the broad demand of 5G consumer end, and the gross profit margin of RF cable increases 1.88Pct compared with the same period last year.
The industry is booming, raising investment to expand production and prepare for the 5G era. The 5G Internet of everything promotes the rapid development of consumer terminals and drives the reform of electronic products. The application field of RF coaxial cable products will be more extensive, and the configuration depth will gradually increase. In the field of aerospace, the market demand for RF coaxial cable for military and civil aerospace equipment is increasing day by day, and the future space is very broad. With the ability of continuous innovation, advanced technology and good product quality, the company has successfully cut into the field of high-end RF coaxial cable occupied by multinational enterprises, and has a favorable position under the background of domestic substitution. The company intends to raise no more than 350 million yuan, strategic layout of 5G communications and aerospace market, will greatly enhance the company's industry position and market competitiveness.
Profit forecast and investment advice: it is estimated that the net profit from 2019 to 2021 will be 0.54 × 0.71 × 0.94 million respectively. The current stock price corresponds to the dynamic PE of 41X/31X/24X, maintaining the "overweight" rating.
Risk hint: downstream market expansion is not as expected.